Obama Asks Geithner to Find Way to Rescind AIG Payouts

President Obama and Treasury Secretary Timothy Geithner meet with small business owners and community lenders on Monday.

President Barack Obama, trying to contain a political firestorm, instructed Treasury Secretary Timothy Geithner “pursue every legal avenue” to block $165 million in bonuses to AIG executives who were in part responsible for the company’s near collapse.

“This is a corporation that finds itself in financial distress due to recklessness and greed,” Mr. Obama said ahead of announcing a plan to rescue small businesses through a raft of new lending options. “Under these circumstances, it’s hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?”

“This isn’t just a matter of dollars and cents. It’s about our fundamental values,” he added.

Meanwhile, New York Attorney General Andrew Cuomo asked AIG to provide details on who’s receiving bonuses in its AIG Financial Products subsidiary by 4 EDT p.m. on Monday or face subpoenas. He has blamed the unit for the insurer’s near collapse last year.        Breaking News

California, no longer the dream state

Job seekers wait in line to enter a job fair in Concord, Calif.

California, a state so large that its economy dwarfs most nations, now has another, less cheery, claim to fame: It is one of the states hardest hit by the country’s unemployment woes. The California jobless rate hit 10.1 percent in January, up from 5.9 percent when the recession began in December 2007. Only Michigan, South Carolina and Rhode Island reported a higher unemployment rate for the first month of the new year, when the national average was 7.6 percent. While other states with exceptionally high unemployment rates are suffering from severe downturns in specific sectors that power their economies — such as Michigan’s auto industry — in California, the state is dealing with a broad array of problems, more similar to the country as a whole, economists say.        Breaking News

Renters in limbo as porperty owner defaults on loans

Chandler, Ariz., police officers confront residents of the Alante at the Islands apartment complex last week at a meeting called to discuss what the renters would do next.

Nicholle Krause first noticed the weeds sprouting in the usually well-manicured grounds of her 320-unit apartment complex in Chandler, Ariz., in December. Soon, signs of neglect began multiplying: Garbage spilled over from the dumpsters, the water in the swimming pool turned a slimy pea green and the grounds were infested by swarms of bees — especially alarming because Krause is severely allergic to bee stings.

“I couldn’t even go outside to enjoy where I live,” said Krause, a 21-year-old office worker who pays $827 a month for a one-bedroom apartment with garage space. “I shouldn’t have to pay $800 a month to live in a … hole.”

It wasn’t until early March that Krause and other residents learned why the complex – the alluringly named Alante at the Islands — was rapidly going to seed. The property owner, Irvine, Calif.-based Bethany Holdings Group, had abandoned the complex and a dozen other large rental properties in the greater Phoenix area after defaulting on hundreds of millions of dollars in loans.        Breaking News

White House bracing for a bailout backlash

WASHINGTON – The Obama administration is increasingly concerned about a populist backlash against banks and Wall Street, worried that anger at financial institutions could also end up being directed at Congress and the White House and could complicate President Obama’s agenda.

The administration’s sharp rebuke of the American International Group on Sunday for handing out $165 million in executive bonuses — Lawrence H. Summers, director of the president’s National Economic Council, described it as “outrageous” on “This Week” on ABC — marks the latest effort by the White House to distance itself from abuses that could feed potentially disruptive public anger.

“We’ve got enormous problems that need to be addressed,” David Axelrod, Mr. Obama’s senior adviser, said in an interview. “And it’s hard to address because there’s a lot of anger about the irresponsibility that led us to this point.”        Breaking news

Limbaugh dominates headlines, leaving the republicans with mixed feelings

Radio Host’s Prominence Underscores Party’s Challenge to Forge New Identity

Rush Limbaugh addresses a conservative conference in February

Rush Limbaugh is right where he wants to be and right where the White House wants him: in the news. But Republicans have more mixed feelings about the controversial talk radio host’s recent elevation.

Mr. Limbaugh dominated headlines this week, as a drive by the White House and other top Democrats to paint him as the leader of the Republican Party left the GOP flummoxed. Michael Steele, the new chairman of the Republican National Committee, illustrated his party’s dilemma, first calling Mr. Limbaugh’s style “ugly,” then phoning him to apologize. One committee member labeled Mr. Steele’s handling of the matter a “Republican Horror Show” and called on him to step down just weeks after taking on the job.

Behind the political theater lay a fundamental challenge for a party seeking a way out of the wilderness after last November’s drubbing. Republican leaders and activists are grappling with how to joust with a popular new president, particularly after years of being accused of embracing a cutthroat style of politics.        Breaking News

Obama pushes health care overhaul

President: ‘The status quo is the one option that is not on the table’

WASHINGTON – President Barack Obama says the clear consensus from the White House health care summit is an immediate need for reform.

Wrapping up the nearly daylong session, Obama said the participants — doctors, lawmakers, insurers, even skeptics — were universal in agreement that the need for health care reform “is here and now.”

Obama entered the room with Sen. Edward Kennedy of Massachusetts, who is battling a brain tumor. After brief remarks summarizing the participants’ observations, Obama called on Kennedy. The veteran Democratic senator said he looked forward to being a foot soldier in the push for health care reform and said: “this time we will not fail.”  The big Washington session — Obama called it a health care summit — and meetings to follow around the country show the new president’s push for universal health care coverage will be more open and inclusive than the Clinton administration’s failed attempt of 15 years ago.       Breaking News

Deloitte and touche raises concerns that GM may not survive

DETROIT – General Motors Corp.’s auditors have raised “substantial doubt” about the troubled automaker’s ability to continue operations, and the company said it may have to seek bankruptcy protection if it can’t execute a huge restructuring plan.

The automaker revealed the concerns Thursday in an annual report filed with the U.S. Securities and Exchange Commission.

“The corporation’s recurring losses from operations, stockholders’ deficit, and inability to generate sufficient cash flow to meet its obligations and sustain its operations raise substantial doubt about its ability to continue as a going concern,” auditors for the accounting firm Deloitte & Touche LLP wrote in the report.

GM also disclosed Thursday that Chief Executive Rick Wagoner received a pay package worth $14.9 million in 2008, although $11.9 million of his compensation was in stock and options whose value plummeted to $682,000 as GM’s share price sank.

Reports said Thursday that President Barack Obama’s administration is working “around the clock” to shore up the struggling automotive industry. GM said in a statement Thursday that the auditors’ going-concern view has no impact on the automaker’s restructuring steps.  The automaker has received $13.4 billion in federal loans as it tries to survive the worst auto sales climate in 27 years. It is seeking a total of $30 billion from the government. During the past three years it has piled up $82 billion in losses, including $30.9 billion in 2008.        Breaking News

Beware Sites Promising Big Government Stimulus Checks for a Fee

The Federal Trade Commission is warning Americans to beware of scams offering to get them some of the federal government's $787 billion stimulus. The scams will likely cost you money instead of getting you money.

“I Got a $12,000 Stimulus Check in Less than 7 days. Get Yours!” Over the past week, this attractive-sounding offer appeared in a Google text ad. Other ads have claimed “Obama’s Giving You Cash” and touted “$40,000 [y]ou don’t ever have to pay back!”

But both the Federal Trade Commission and the Better Business Bureau are cautioning consumers about ads that promise easy access to government money, ads that they say have multiplied since passage of the economic stimulus package.

“The bottom line on this is, these are scams,” says Eileen Harrington, acting director of the FTC’s Bureau of Consumer Protection. “The stimulus is not passing out checks to individual consumers.”        Breaking News

Republicans seek balance with Limbaugh

For a man who expresses no desire to lead the Republican Party, Rush Limbaugh has a knack for creating problems for those who do.

Still smarting from consecutive electoral drubbings, Republicans now find themselves caught in a crossfire between Democrats pressuring them to denounce the conservative talk radio host’s bombastic criticism of a popular new president and his own denunciations of their party as an embarrassment.

The ongoing controversy over Limbaugh’s statement in a speech to the Conservative Political Action Conference on Saturday that he wants “Barack Obama to fail” and the aggressive Democratic pushback it drew has emerged as the latest challenge for a party struggling to find its voice and lacking an obvious national leader.        Breaking News

Bankers unhappy about bailout

America’s banking executives are having a tough time. First, they mess things up so badly that they require a humongous federal bailout.

No sooner do they get the federal funds than they start complaining about how difficult it is to manage a bank when taxpayers are looking over their shoulders. The logical thing for an executive in such a situation to do would be to make the most strenuous efforts possible to return the bailout funds.

Would it surprise you to learn that the bankers complaining most about the shackles that come along with bailout money don’t seem to have much of a sense of urgency about doing so?

In October, Northern Trust, the Chicago-based bank announced it would take $1.5 billion in TARP funds. But now it’s expressing annoyance that members of Congress are teed off about its sponsorship of a golf tournament. The bank, which is in good health, says it didn’t seek the funds but agreed to participate because the government wanted all the major banks to take part.        Breaking News